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By: Naishtat, Seaman, Raymond, Madden, H.B. No. 329
Menendez, et al.
A BILL TO BE ENTITLED
AN ACT
relating to the regulation of mold assessors and remediators, civil
liability for mold remediation, and insurance coverage on mold
claims; providing civil and administrative penalties.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subtitle B, Title 12, Occupations Code, is
amended by adding Chapter 1958 to read as follows:
CHAPTER 1958. MOLD ASSESSORS AND REMEDIATORS
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 1958.001. DEFINITIONS. In this chapter:
(1) "Board" means the Texas Board of Health.
(2) "Commissioner" means the commissioner of public
health.
(3) "Department" means the Texas Department of Health.
(4) "License" means a license issued under this
chapter.
(5) "Mold" means any living or dead fungi or related
products or parts, including spores, hyphae, and mycotoxins.
(6) "Mold assessment" means:
(A) an inspection, investigation, or survey of a
dwelling or other structure to provide the owner or occupant with
information regarding the presence, identification, or evaluation
of mold;
(B) the development of a mold management plan or
remediation protocol; or
(C) the collection or analysis of a mold sample.
(7) "Mold remediation" means the removal, cleaning,
sanitizing, demolition, or other treatment, including preventive
activities, of mold or mold-contaminated matter that was not
purposely grown at that location.
Sec. 1958.002. SCOPE OF AUTHORITY. (a) This chapter
applies only to the regulation of mold-related activities that
affect indoor air quality.
(b) This chapter does not apply to:
(1) the following activities when not conducted for
the purpose of mold assessment or mold remediation:
(A) routine cleaning;
(B) the diagnosis, repair, cleaning, or
replacement of plumbing, heating, ventilation, air conditioning,
electrical, or air duct systems or appliances;
(C) commercial or residential real estate
inspections; and
(D) the incidental discovery or emergency
containment of potential mold contamination during the conduct or
performance of services listed in this subsection; or
(2) a pest control inspection conducted by a person
regulated under Chapter 1951.
[Sections 1958.003-1958.050 reserved for expansion]
SUBCHAPTER B. POWERS AND DUTIES
Sec. 1958.051. GENERAL POWERS AND DUTIES OF DEPARTMENT;
SCOPE OF AUTHORITY. The department shall administer this chapter
to protect the public from the adverse health effects of mold.
Sec. 1958.052. EDUCATION PROGRAM. (a) The department
shall conduct a statewide education and outreach program regarding
the health implications of mold growth in indoor environments. The
program must include methods to recognize, prevent, and mitigate
mold occurrence.
(b) The department may contract with governmental entities
or other persons to provide the program.
Sec. 1958.053. GENERAL RULEMAKING AUTHORITY. The board
shall adopt substantive and procedural rules as necessary or
desirable for the board, department, and commissioner to discharge
their powers and duties under this chapter.
Sec. 1958.054. RULES REGARDING PERFORMANCE STANDARDS AND
WORK PRACTICES. The board by rule shall establish minimum
performance standards and work practices for conducting a mold
assessment or mold remediation in this state.
Sec. 1958.055. FEES. The board shall establish reasonable
and necessary fees to administer this chapter, including fees for
licenses and examinations. The board shall set the fees in an
amount sufficient to recover the costs of administering this
chapter.
Sec. 1958.056. INSPECTIONS. (a) The department shall
conduct inspections as necessary to ensure compliance with this
chapter.
(b) The board shall adopt rules regarding compliance
investigations.
Sec. 1958.057. COMPLAINTS. The department shall
investigate any complaint regarding mold-related activities.
[Sections 1958.058-1958.100 reserved for expansion]
SUBCHAPTER C. LICENSE REQUIREMENTS
Sec. 1958.101. LICENSE REQUIRED; RULES. (a) A person may
not engage in:
(1) mold assessment unless the person holds a mold
assessment license; or
(2) mold remediation unless the person holds a mold
remediation license.
(b) The board shall adopt rules regarding:
(1) the scope of mold-related work for which a license
is required, including the supervision of employees or other
persons by license holders; and
(2) renewal requirements for a license issued under
this chapter.
Sec. 1958.102. EXEMPTIONS. (a) An owner or tenant, or a
managing agent or employee of an owner or tenant, is not required to
be licensed under this chapter to perform mold assessment or mold
remediation on property owned or leased by the owner or tenant.
This exemption does not apply:
(1) if the managing agent or employee engages in the
business of performing mold assessment or mold remediation for the
public;
(2) if the mold remediation is performed in an area in
which the mold contamination affects a total surface area of 25
contiguous square feet or more; or
(3) to a person who is exempt under Subsection (e).
(b) An employee of a license holder is not required to be
licensed under this chapter to perform mold assessment or mold
remediation while supervised by the license holder, as provided by
rules adopted under Section 1958.101.
(c) A person is not required to be licensed under this
chapter to perform mold remediation in an area in which the mold
contamination affects a total surface area for the project of less
than 25 contiguous square feet.
(d) A person is not required to be licensed under this
chapter to perform mold assessment or mold remediation in a
one-family or two-family dwelling that the person constructed or
improved if the person performs the mold assessment or mold
remediation at the same time the person performs the construction
or improvement or at the same time the person performs repair work
on the construction or improvement. This exemption does not apply
if:
(1) the person engages in the business of performing
mold assessment or mold remediation for the public; or
(2) the mold remediation is performed in an area in
which the mold contamination affects a total surface area of 25
contiguous square feet or more.
(e) An owner, or a managing agent or employee of an owner, is
not required to be licensed under this chapter to perform mold
assessment or mold remediation on a residential property owned by
that person with fewer than 25 dwelling units. This exemption does
not apply if the managing agent or employee engages in the business
of performing mold assessment or mold remediation for the public.
Sec. 1958.103. RULES REGARDING LICENSE APPLICATION. The
board shall adopt rules regarding a license application. The board
shall adopt rules that establish minimum requirements for a
license, including the type, term, qualifications, renewal, and
liability insurance requirements for the license.
Sec. 1958.104. EXAMINATION. The department may require
that an applicant for a license pass a competency examination to
qualify for the license.
Sec. 1958.105. CONTINUING EDUCATION. (a) The board shall
adopt rules regarding continuing education required under this
chapter.
(b) The rules may include requirements regarding continuing
education providers, including rules establishing:
(1) accreditation by the department;
(2) curriculum and training requirements; and
(3) qualifications.
Sec. 1958.106. RECIPROCITY. The board may adopt rules that
facilitate reciprocity and communication with other states that
have a similar licensing program.
[Sections 1958.107-1958.150 reserved for expansion]
SUBCHAPTER D. PRACTICE BY LICENSE HOLDER
Sec. 1958.151. SCOPE OF WORK ANALYSIS. (a) A license
holder who intends to perform mold assessment on a mold remediation
project shall prepare a work analysis for the project. The license
holder shall provide the analysis to the client before the mold
remediation begins.
(b) The work analysis must specify:
(1) the rooms or areas where the work will be
performed;
(2) the quantities of materials to be removed or
cleaned at the project;
(3) the proposed methods for each type of remediation
in each type of area in the project; and
(4) the proposed clearance criteria for each type of
remediation in each type of area in the project.
Sec. 1958.152. REMEDIATION WORK PLAN. (a) A license holder
who intends to perform mold remediation shall prepare a work plan
providing instructions for the remediation efforts to be performed
for the mold remediation project. The license holder shall provide
the work plan to the client before the mold remediation begins.
(b) The license holder shall maintain a copy of the work
plan at the job site where the remediation is being performed.
Sec. 1958.153. NOTICE; CERTIFICATE OF MOLD REMEDIATION.
(a) Except as provided by Subsection (c), not later than the fifth
day before the date on which a license holder starts mold
remediation at a property, the license holder shall notify the
department in writing about the project.
(b) Not later than the 10th day after the date on which a
license holder completes mold remediation at a property, the
license holder shall provide a certificate of mold remediation to
the property owner and the department. The certificate must
include a statement by a mold assessment license holder that, based
on visual, procedural, and analytical evaluation, the mold
contamination identified for the project has been remediated as
outlined in the mold management plan or remediation protocol. If
the mold assessment license holder determines that the underlying
cause of the mold has been remediated so that it is reasonably
certain that the mold will not return from that remediated cause,
the mold assessment license holder shall indicate on the
certificate that the underlying cause of the mold has been
remediated.
(c) In an emergency, notice to the department under
Subsection (a) may be made verbally but must be made not later than
the next business day after the license holder identifies the
emergency. For purposes of this subsection, an emergency exists if
a delay in mold remediation services in response to a water damage
occurrence would increase mold contamination.
(d) The board shall adopt rules to implement this section,
including rules:
(1) describing the information that must be provided
in the notice and certificate of mold remediation; and
(2) authorizing verbal notification to the department
in an emergency.
(e) In the event that a school or other public building has
been issued a certificate of mold remediation under this
subchapter, the entity that owns the building, the entity that
occupies the building, and any persons authorized by such entities
to make a determination regarding whether the building will be
reoccupied shall not be liable in a civil lawsuit for damages
relating to the decision to allow occupancy of the building
following mold remediation.
Sec. 1958.154. CONFLICT OF INTEREST; DISCLOSURE REQUIRED.
(a) A license holder may not perform both mold assessment and mold
remediation on the same project.
(b) A person may not own an interest in both the entity that
performs assessment services and an entity that performs
remediation services on the same project.
(c) A license holder who is not an individual shall disclose
to the department the name, address, and occupation of each person
that has an ownership interest in the license holder. The license
holder shall report any changes in ownership to the department. The
board shall adopt rules to implement this section, including rules
regarding the form of the disclosure and the time required to make
disclosures or to report a change in ownership.
Sec. 1958.155. CODE OF ETHICS. The board by rule shall
adopt a code of ethics for license holders that promotes the
education of mold assessors and mold remediators concerning the
ethical, legal, and business principles that should govern their
conduct.
Sec. 1958.156. MOLD REMEDIATOR LICENSING AND
RESPONSIBILITIES. A mold remediator must maintain a file regarding
each mold remediation for a minimum of three years from the date of
completion of the mold remediation and make such file available for
inspection by the department or any law enforcement entity. The
file must contain such material as the department may determine,
and must also include photographic evidence of the scene of the mold
remediation taken before and after the remediation, the written
contract between the mold remediator or any other party regarding
the mold remediation, and all invoices issued regarding the mold
remediation. The mold remediation company or mold remediation
contractor must provide the owner of the building with copies of all
photographic evidence required by this section within one week of
the completion of the mold remediation.
[Sections 1958.157-1958.200 reserved for expansion]
SUBCHAPTER E. DISCIPLINARY PROCEDURES
Sec. 1958.201. DISCIPLINARY ACTION. If a license holder
violates this chapter or an order or rule adopted under this
chapter, the department, after providing the person with notice and
an opportunity for a hearing, shall take one or more of the
following actions:
(1) revoke, suspend, or refuse to renew the license;
(2) impose an administrative penalty;
(3) bring an action to collect a civil penalty; or
(4) reprimand the person.
[Sections 1958.202-1958.250 reserved for expansion]
SUBCHAPTER F. ADMINISTRATIVE PENALTY
Sec. 1958.251. IMPOSITION OF ADMINISTRATIVE PENALTY. The
commissioner may impose an administrative penalty on a person who
violates this chapter or a rule adopted or order issued under this
chapter.
Sec. 1958.252. AMOUNT OF PENALTY. (a) The amount of an
administrative penalty may not exceed $5,000 for each violation.
Each day a violation continues under Section 1958.101 or 1958.154
may be considered a separate violation for purposes of imposing a
penalty.
(b) In determining the amount of the penalty, the
commissioner shall consider:
(1) whether the violation was committed knowingly,
intentionally, or fraudulently;
(2) the seriousness of the violation;
(3) any hazard created to the health and safety of the
public;
(4) the person's history of previous violations; and
(5) any other matter that justice may require.
Sec. 1958.253. EXCEPTION TO ADMINISTRATIVE PENALTY. (a)
The commissioner may choose not to impose an administrative penalty
under this subchapter if, not later than the 10th day after the date
of written notice of the violation under Section 1958.254, the
person provides conclusive evidence that the circumstances giving
rise to the violation have been corrected and all actual damages are
paid.
(b) This section does not apply to a violation alleged under
Section 1958.101 or 1958.154.
Sec. 1958.254. NOTICE; OPPORTUNITY FOR HEARING; ORDER. (a)
The commissioner may impose an administrative penalty under this
subchapter only after the person charged with a violation is given a
written notice and the opportunity for a hearing.
(b) The written notice must state the facts that constitute
the alleged violation and the law or rule on which the violation is
based.
(c) If a hearing is held, the commissioner shall make
findings of fact and issue a written decision as to:
(1) the occurrence of the violation; and
(2) the amount of any penalty that is warranted.
(d) If the person charged with a violation fails to exercise
the opportunity for a hearing, the commissioner, after determining
that a violation occurred and the amount of the penalty that is
warranted, may impose a penalty and shall issue an order requiring
the person to pay any penalty imposed.
(e) Not later than the 30th day after the date the
commissioner issues an order after determining that a violation
occurred, the commissioner shall inform the person charged with the
violation of the amount of any penalty imposed.
(f) The commissioner may consolidate a hearing under this
section with another proceeding.
Sec. 1958.255. OPTIONS FOLLOWING DECISION: PAY OR APPEAL.
(a) Not later than the 30th day after the date the commissioner's
decision or order becomes final as provided by Section 2001.144,
Government Code, the person shall:
(1) pay the administrative penalty; or
(2) file a petition for judicial review contesting the
fact of the violation, the amount of the penalty, or both.
(b) Within the 30-day period, a person who acts under
Subsection (a)(2) may stay enforcement of the penalty by:
(1) paying the penalty to the commissioner for
placement in an escrow account; or
(2) giving the commissioner a bond in a form approved
by the commissioner that:
(A) is for the amount of the penalty; and
(B) is effective until judicial review of the
commissioner's decision or order is final.
Sec. 1958.256. COLLECTION OF PENALTY. At the request of the
commissioner, the attorney general may bring a civil action to
recover an administrative penalty imposed under this subchapter.
Sec. 1958.257. JUDICIAL REVIEW. Judicial review of a
decision or order of the commissioner imposing a penalty under this
subchapter is instituted by filing a petition with a district court
in Travis County and is under the substantial evidence rule as
provided by Subchapter G, Chapter 2001, Government Code.
Sec. 1958.258. REMITTANCE OF PENALTY AND INTEREST OR
RELEASE OF BOND. If after judicial review the administrative
penalty is reduced or is not upheld by the court, the commissioner
shall:
(1) remit the appropriate amount, plus accrued
interest, to the person not later than the 30th day after the date
of the determination, if the person paid the penalty; or
(2) execute a release of the bond, if the person gave a
bond.
[Sections 1958.259-1958.300 reserved for expansion]
SUBCHAPTER G. OTHER PENALTIES; ENFORCEMENT PROVISIONS
Sec. 1958.301. CIVIL PENALTY. (a) A person who violates
this chapter or a rule adopted under this chapter is liable for a
civil penalty in an amount not to exceed $2,000 for the first
violation or $10,000 for a second or later violation.
(b) The commissioner may request the attorney general or the
district, county, or city attorney having jurisdiction to bring an
action to collect a civil penalty under this section.
Sec. 1958.302. INJUNCTIVE RELIEF. The commissioner may
request the attorney general or the district, county, or city
attorney having jurisdiction to bring an action in a district court
of Travis County for a restraining order, injunction, or other
relief the court determines is appropriate if it appears to the
department that a person is violating or has violated this chapter
or a rule adopted under this chapter.
SECTION 2. Subchapter B, Chapter 21, Insurance Code, is
amended by adding Article 21.21-11 to read as follows:
Art. 21.21-11. PROHIBITION OF CERTAIN UNDERWRITING
DECISIONS BASED ON PREVIOUS MOLD CLAIM
Sec. 1. DEFINITIONS. In this article:
(1) "Insurer" means an insurance company, reciprocal
or interinsurance exchange, mutual insurance company, capital
stock company, county mutual insurance company, farm mutual
insurance company, Lloyd's plan, or other legal entity authorized
to write residential property insurance in this state. The term
includes an affiliate, as described by Section 823.003(a), if that
affiliate is authorized to write and is writing residential
property insurance in this state. The term does not include:
(A) an eligible surplus lines insurer regulated
under Chapter 981;
(B) the Texas Windstorm Insurance Association
under Article 21.49; or
(C) the FAIR Plan Association under Article
21.49A.
(2) "Mold" means any living or dead fungi or related
products or parts, including spores, hyphae, and mycotoxins.
(3) "Mold remediation" means the removal, cleaning,
sanitizing, demolition, or other treatment, including preventive
activities, of mold or mold-contaminated matter that was not
purposely grown at that location.
(4) "Residential property insurance" means insurance
against damage to or loss of real or tangible personal property at a
fixed location provided in a homeowners insurance policy or
residential fire and allied lines insurance policy.
Sec. 2. APPLICABILITY. This article applies to each
insurer that writes residential property insurance in this state.
Sec. 3. PROHIBITION. An insurer may not make an
underwriting decision regarding a residential property insurance
policy based on previous mold damage if:
(1) the applicant for insurance has made a previous
claim under any residential property policy for damage caused by
mold;
(2) mold remediation has been performed on the
property that is the subject of the claim; and
(3) the property was:
(A) remediated, as evidenced by a certificate of
mold remediation issued to the property owner under Section
1958.153, Occupations Code, that establishes that the underlying
cause of the mold at the property has been remediated; or
(B) inspected by an independent assessor or
adjustor who determined, based on the inspection, that the property
does not contain evidence of mold damage.
Sec. 4. RULES. The commissioner shall adopt rules as
necessary to implement this article.
Sec. 5. PENALTY. An insurer who violates this article
commits an unfair practice in violation of Article 21.21, Insurance
Code.
SECTION 3. The Texas Board of Health shall adopt the rules
required by Chapter 1958, Occupations Code, as added by this Act,
not later than April 1, 2004.
SECTION 4. (a) Except as provided by Subsection (b) of this
section, this Act takes effect September 1, 2003.
(b) Section 1958.101(a), Occupations Code, and Subchapters
D, E, F, and G, Chapter 1958, Occupations Code, as added by this
Act, take effect July 1, 2004.